Anyone who was investing in cryptocurrencies in late 2017 will remember the last few months of the year for the rest of their life. The crypto-craze had hit fever pitch and almost every currency had swelled up in price compared to how they had started the year. Bitcoin was up by 1400%, Ethereum by 9000% and Ripple by 36,000% – what a time to be alive!
However, early 2018 showed a reverse trend and prices of almost all cryptocurrencies fell by over 50%. As optimistic as the end of 2017 was, the beginning of 2018 was equally disappointing for the investors. However, now that the markets have begun to recover – there’s optimism all around and investors are getting back as a bullish momentum begins to form.
While it is practically impossible to ‘predict’ how the cryptocurrency markets will perform, but there are certain assumptions which can be made – which hold true despite the market performance. Even in early 2017, there were some who had predicted Bitcoin to cross $10,000 and $15,000 marks later in the year – nobody believed them initially, but this did turn out to be true.
Let us take a closer look at some probable scenarios for 2018 – and how cryptocurrency markets are expected to perform over the remainder of the year.
Cryptocurrency Predictions for 2018
New All-Time Highs
While 2017 witnessed unprecedented price growth, current expectations are that 2018 would be a year when those all-time highs would be topped and new records would be set by almost all currencies. By late 2018, practically every cryptocurrency is likely to be priced higher than it ever was. This price growth is likely to be driven because of the institutional investors and high-value players who would be investing their money into the markets, mostly via hedge funds and other investment funds which are rising in number with every passing day. This high influx of money is bound to have a significant impact on cryptocurrency prices over the year.
Cryptocurrency market cap will finally cross $1 Trillion
The aforementioned institutional investors are expected to not only help the cryptocurrency prices surge, but are also expected to help the market cap increase. These movements are co-related. As more and more money gets pumped into cryptocurrencies, their market cap tends to increase. However, despite the massive influx of money in the crypto-markets, the $1 Trillion cap is yet to be achieved. However, 2018 is expected to be the year this much-awaited landmark is finally crossed.
A Regulated Ecosystem
Another thing that is bound to happen when it comes to the world of cryptocurrencies in 2018 is the fact that regulations are going to increase. Governments and financial authorities around the world have been taking note of this and have been trying to introduce various legislations that will regulate cryptocurrencies. In some places such as Russia the government itself is planning these out while in some nations, this power is delegated to financial bodies. In some countries like Korea, exchanges have come together to form a union for self-regulation.
Regardless of who imposes these regulations – cryptocurrency exchanges as well as ICOs are both going to get greatly regulated than they ever were in the past. This will ensure that all cryptocurrency platforms have proper security standards and that ICO scams get squashed.
Better Tax Laws
Taxing cryptocurrencies is something which has been bothering governments across the world. While some countries tax it as a property, others tax it as a commodity and some don’t tax it at all – some countries tax the miners, some don’t. At present, there is way too much confusion when it comes to cryptocurrencies and how taxes are supposed to be filed. In countries where tax structures are layered and complex, cryptocurrency taxation falls in a gray area and is often an unaccounted source of income.
Countries which don’t really have many sources of income, primarily small island nations – such as Malta and Bermuda – are expected to empower the cryptocurrency economy. Malta’s and Bermuda’s recent deals with Binance are just one example of this. Gibraltar too, has been surging in popularity in the crypto-world of late. Expect more nations such as these to come up over the course of the year – driving the crypto markets forward.
Blockchain Tech Goes Big
While the cryptocurrencies and the crypto-markets boom, the technology that powers and accelerates this growth is the blockchain tech. Blockchain is expected to get even bigger in 2018. There are some countries such as Iran, China and India which are showing a hostile attitude towards cryptocurrencies. However, even these countries appreciate the power of the blockchain technology.
With the first Presidential elections being held over the blockchain in Sierra Leone, it is expected that more countries will adopt the blockchain technology for infusing transparency into the political system. India, despite not being so confident on cryptos, continues to support the blockchain technology – using it for government projects. Same is the case with China, another hostile name in the world of cryptos but a big supporter of blockchain systems.
2018 is also expected to be the year we see national cryptocurrencies becoming mainstream. While Venezuela has already started off with their ‘Petro’ cryptocurrency, Iran, India, Israel and Russia are also planning on setting up their national cryptocurrencies. Reports had indicated in the past that the Royal Bank of England too, has similar plans for the future.
Moreover, a common cryptocurrency for the EU nations and for the BRICS nations was also proposed by Vladimir Putin recently. It is expected that national, state-backed cryptocurrencies would soon become a global trend – and it would all start in 2018.
Increase in Adoption
Another major expectation this year is that the adoption will increase. This is not even an ‘expectation’ but more of a statistical guarantee. Adoption has been on a rise on a year on year basis ever since cryptocurrencies started off and there is absolutely no reason why 2018 should be any different.
2018 is likely to be the year which gets the biggest boost in adoption as cryptocurrencies are working towards becoming faster and reducing fees. Moreover, with the rise in awareness after the 2017-Bitcoin Boom, it is expected that more people know about cryptos now than ever before. Hence, adoption is all set to rise in 2018.
ICOs will Continue To Break Records
Initial Coin Offerings – ICOs – often the most controversial subject in a cryptocurrency discussion – are expected to continue popping up all through 2018. 2017 was the year with the most number of ICOs, and 2018 is likely to top that number.
However, with government authorities becoming increasingly strict and with new and innovative ICO methods such as DAICOS coming up, it appears that 2018 will be the year the downfall of ICO-scams begins – and the number will continue to decline with every passing year.
Rise in Risks
Finally, with the rise in adoption and the rise in awareness – there is bound to be a rise in cryptocurrency related risks. Considering the fact that a large number of new traders keep joining the cryptocurrency markets with every passing day – there is a risk that scams and hacks will increase. With daily trade volume in some exchanges going north of a billion dollars, hackers are eyeing the jackpot – waiting to strike. Consumers are expected to become smarter and use safer means of authentication as well as move to hard wallets for safety reasons.
Finally, every new technology out there is destined to receive both positive as well as negative responses. The best way here is to keep yourself updated with latest crypto-going-ons using cryptocurrency guides. But for what data says, cryptocurrency trend is not going away anytime sooner.